Frequently Asked Questions

Selling FAQ

Not always. Many practices are handled by the dentist himself; however, the risks to a seller are significant and numerous.  If you are not trained in the skills of establishing an accurate valuation of your practice and you are not trained in other skills such as determining the qualifications of your buyer such as his financial ability to make the purchase, or determine his standings with various state dental boards, or even the buyers ability to successfully run the practice and treat your patient friends as you would prefer, then you should leave those determinations to a qualified dental practice broker who does possess that ability.  The advantages of using a practice broker are many, and most doctors find that not only is their transition handled more quickly and efficiently by using a broker, but most practices sold by a broker, will bring a more favorable price to the seller, than if handled by an individual with no experience in fine tuning a practice sale. This difference in value received usually more than covers any expenditure created by the broker's fee.

A broker can find and qualify a buyer to whom your practice may be presented. A quality broker will have the ability to market the practice to potential buyers, “globally” in a manner that presents the practice in its best interest. Brokers also act as a facilitator in any negotiations which may be necessary in selling the practice, which helps remove the concerns and emotions from the negotiating table. The assistance brokers may provide in the development of contracts, and the consulting processes with attorneys and accountants is invaluable.  Brokers also have multiple sources of financing for the purchase of your practice, and thereby avoid the owner, in almost all cases, from having to address the need to finance a portion of, or all of the practice price, himself.  It is a wise person who surrounds himself with knowledgeable people when dealing in areas he does not fully understand.

The value placed on your dental practice is critical for a successful practice sale. Professional Practice Associates can help you in establishing a price that is fair to both the buyer and the seller. When establishing the value of your practice, the advice of dental suppliers, your dentist friends and untrained accountants and attorneys can and usually is inaccurate and will be a number that is difficult to support.  It could even subject you, as the seller, to try to defend that price in a court of law.  These practices of establishing practice values are dangerous. Accurate comprehensive practice valuations must be done by those knowledgeable in the techniques and market performance of practice values and sales in your geographic area. Practices that may appear similar may vary widely in value. Differences in services rendered, the longevity of staff and doctor, operating overhead, location and transferability are only a few of the nearly seventy points of practice characteristics used by Professional Practice associates in the development of a comprehensive practice valuation. We utilize several accepted methods of practice valuations in our determinations to insure a fair and accurate price to place on each of our practice listings. Lending institutions will not make loans based upon an uninformed guess or unqualified estimates of practice value.

If you are reading my web site, then you have already taken the step to begin the investigative process of selling your practice, and I congratulate you for that. I believe that one should begin to think about his own practice transition when he first begins to practice, as it is inevitable that the day will come. If you are now at the point where you are considering selling your practice, for whatever reason, then you cannot begin too soon. Five years out if a good benchmark, but is the time line is much closer, then you must act immediately. Selling a practice takes careful planning, and requires good business decisions. The practice brokers of Professional Practice Associates can be of great help to you in accomplishing your transition goals, and our pre-listing consultations, regarding potential practice sales, are absolutely FREE of charge.

A qualified practice broker should have numerous sources for practice sales financing and it is seldom necessary for the selling doctor to be required to be the financier of any portion of the practice sale. Professional Practice Associates has an excellent business relationship with many the lending institutions, especially those best known to specialize in financing dental practice sales. Many of these companies will carry 100%, or more, of the financing necessary to purchase a dental practice, and will do so with rates and terms allowing the buyer to maintain an effective cash flow. Not “all” banks understand the financing of a dental practice, because a large portion of its value is based upon "good will." The lending institutions used by Professional Practice Associates are all very familiar with all aspects of financing dental practices and are anxious to have our business.

If you wish to continue practicing for a period of time, and/or wish to slow down and gradually leave the practice, then a buy-in from another dentist may be something for you to consider. These agreements are often stressful for both parties and, unless structured exceptionally well, often create problems. If one is already involved in a partial sale or associate arrangement, then the buyout is the ultimate goal. In these scenarios, Professional Practice Associates can help you establish a value for your practice sale, explain to you, the risks of such a transition and guide you through the complicated process of a partial sale or an outright sale.

If you wish to continue practicing at a pace close to what you practice now, and you have enough business in your practice to support both you and another dentist adequately, then an associate arrangement may be something you should consider. ALL associate arrangements MUST include written plans for a future buy-in and/or buyout of the dental practice, and those details should be clearly spelled out in a contract from the very beginning of the associate arrangement. Failure to do so can destroy future sales and relationships between the dentist parties. ADS PROFESSIONAL PRACTICES can assist you in these considerations.